A team of Mumbai police is headed home armed with crucial evidence provided by the Federal Bureau of Investigation (FBI) indicating that the Nov 26 Mumbai terror attacks were planned in Pakistan.

A three-member Mumbai police team headed by Deputy Inspector General of Police Deven Bharti left for Mumbai on Wednesday with details of how the Mumbai attackers kept in touch with their Lashkar-e-Taiba (LeT) masters in Karachi.

The US investigating agency charged with protecting the US against terrorist and foreign intelligence threats provided India details of calls made through the Voice over Internet Protocol (VoIP), a satellite phone as also documents relating to the Global Positioning System used by the terrorists while sailing from Karachi.

The forensic examination of the bullets used by the terrorists in Mumbai was also a part of the evidence collected from FBI by Mumbai Police.

The evidence from FBI is expected to make the case against the terrorists water-tight and nail Islamabad's claims that the conspiracy behind the Nov 26 attacks was not hatched in Pakistan alone.

India had sought the US help in analysing the evidence under their Mutual Legal Assistance Treaty (MLAT) that came into effect in December 2005.

The Mumbai police team came here last week with Letters Rogatory or Letters of Request issued by a Mumbai court to the US Department of Justice.

New Delhi: Lashkar-e-Toiba (LeT) ringleaders had ambitions well beyond Mumbai and had placed India's financial hub in a list of 320 worldwide locations as potential targets for commando-style terror strikes, The Guardian has said in a report published on Thursday.

According to the report, western intelligence agencies that accessed the computer and email account of the LeT's communications chief Zarar Shah found a list of possible targets, only 20 of which were in India.

Two of the November 2008 attack's key planners - Zarar Shah and Lashkar's operations chief Zakiur Rehman Lakhvi - are now in police custody in Pakistan.

Analysts say the computer list is more of a statement of intent because Lashkar would need time to set up terrorist cells in so many places.

Islamabad's decision to bring criminal charges against nine men accused of involvement in the Mumbai attack has partly placated Indian officials but officials in New Delhi have been warning that they want to see people brought to justice for terrorist acts.

Pakistan a safe haven for terrorists: Hillary

"There has been some speculation that raids in Spain which netted 12 men - an Indian and 11 Pakistanis - were a result of the investigations into Lashkar's role in the Mumbai attacks," the report said.

"The dozen men were reportedly picked up for forging passports and other travel documents for terror organisations, including al-Qaeda. Pakistan's government has said the Mumbai attacks were partly planned from Spain."

The US has been trying behind the scenes to coordinate intelligence exchanges between the two nuclear-armed rivals. The CIA has worked hard to be seen to help New Delhi - including by recovering phone numbers deleted by the terrorists on their satellite phones.

The fallout from Mumbai has destabilised the government of Pakistan's President Asif Ali Zardari, which is attempting to face down Islamist groups his predecessors cultivated.

Intelligence agencies have warned that Mumbai raises the spectre of a new style of terrorist assault. The city of 190 million people was brought to a halt by 10 heavily armed gunmen rampaging through a railway station, a house, restaurants and hotels for three days, killing over 170 people

MUMBAI: The FBI investigations into the November terror attack have established a Pakistan link to the payments made for the VoIP card from
Callphonex of the US.

VoIP allows one to make cheap phone calls over Internet and payment for it can be made by wire transfer from anywhere in the world. ‘‘We have traced the financial transactions to Pakistan,’’ a senior official said.

At the same time, the official said that they have not been able to gather evidence admissible in court to pinpoint that the calls originated from Pakistan.

‘‘We are in the process of gathering further evidence and solve the jigsaw puzzle in the next few days. However, we have been able to obtain enough material linking Pakistan to the terror attack, but at this stage some of it is not admissible as evidence in the court,’’ the officer said.

One of the virtual numbers from which the call to the terrorists was made was set up with a US company Callphonex by one Kharak Singh who claimed to be from India. The money for the same came through Western Union money transfer from one Javed Iqbal in Pakistan.

National Security Guard (NSG) has identified key high-end equipment required to better deal with urban terror situations and has already begun the process to acquire cutting edge new technology. The NSG's shopping list includes high end gadgets like body-worn video and audio bugs, Mini Remotely Operated Vehicles and Real Time X-Ray Viewing System.

While NSG officials maintained that the force keeps on acquiring such equipment from time to time, sources said this time the acquisition of such gadgets was a direct fallout of the 26/11 debriefing where senior NSG Black Cats highlighted operational handicaps they faced on account of not having critical equipment during their 60-hour-long operations in Mumbai's terror theatres.

Learning from the Mumbai experience, the NSG is scouting for video bugs which essentially are body-worn colour cameras with a transmitter and are designed to look like either a spectacle or a standard tie-pin and have a minimum pick-up range of 10 feet and minimum transmission range of 200 metres. The commando force also wants to procure equipment capable of re-transmitting the signal transmitted by a video bug at a different frequency and higher power output to enhance the working range. The force is looking to procure miniature digital audio transmitters having built-in microphones and antennae. Having such video and audio bugs, said sources, would enable Black Cats to capture and transmit real-time "live" images and sounds during an ongoing operation.

In addition, the NSG is looking to procure a Real Time X-ray viewing system which can help in real-time measurement of objects located behind obstructions like walls. "What we are looking for is an x-ray system which is compact, light-weight and easy to set-up, even from a remote location," an official said. Also on the shopping list is a Mini Remotely Operated Vehicle (MROV) which can be launched to carry out surveillance inside "buildings and installations", "aircraft and trains", "passenger terminals", "on ferries and ships" and "under the vehicles". "The kind of MROV we are looking for should have a climbing capability of stairs and slopes at 45 degrees, should have a video colour camera, night-vision capability and modular weapon mounting system," an official said.

Sources said that proposals to procure these equipment have been lying in cold-storage for years and have finally seen the light of the day now. The NSG has already come out with detailed technical specifications for all these devices and is in the process of floating tenders.

After Pakistan admitted last week that Mumbai attacks were planned on its soil, it sent India a list of 30 questions, which it said were essential to be answered before it could take further action against the guilty. The ball is now in India's court.

Pak fires 30 questions on 26/11 to India

Since then there has been a slew of meetings in the home ministry and the Ministry of External Affairs to decide on the response. The urgency arises as India doesn't want Pakistan to either divert attention from the terror issue or for it to say that India is not cooperating in the probe.

India Today has obtained exclusive details of Pakistan's note verbale, including the 30 posers, sent to India. Most of the questions are specific and seek details of the Indian probe, including Ajmal Amir Kasab's confessions in court, recent photographs of the nine dead terrorists, DNA samples, fingerprints and other identity particulars.

Pak admits links to Mumbai terror attacks

Pakistan, however, has also raised some tricky questions about the circumstances related to Mumbai ATS chief Hemant Karkare's death. This, besides hinting at the role of Indians in the Mumbai attacks by seeking to know how the attackers managed to get Indian SIM cards and why the Indian Navy could not intercept them.

The note says that based on the information provided by India and its own investigations into the Mumbai attacks, Pakistan had filed FIR No 01-2009 in the special investigation unit of the Federal Investigation Agency against eight suspected terrorists. It says these clarifications and information are essential for Islamabad to complete the investigations and to get the accused convicted in a court of law.

The global link in Mumbai terror attack

Pakistan also said six of the eight accused of the Mumbai plot belonged to the now defunct Lashkar-e-Toiba, had been taken into custody and were being interrogated. It also said links to the conspiracy were found in other nations, including the US, Austria, Spain, Italy and Russia. Sources say, the Indian response, which is currently being drafted, may ask Pakistan to allow Indian investigators to question those eight suspects and piece the missing links together. Pakistan, meanwhile, has indicated that it may want to question Kasab.

Indian experts view Pakistan's posers seeking details on the circumstances leading to the death of Karkare as not without political motive. Islamabad has also sought interrogation reports of two Indians, Tausif Rehman and Mukhtar Ahmed Sheikh, who were arrested in Kolkata for allegedly providing SIM cards to the attackers.

Special: Mumbai terror attack

Besides, the poser on how they got Indian SIM cards is being viewed as an attempt by Pakistan to strengthen the theory that there may have been strong Indian links to the attacks. Not satisfied with the transcripts of the conversation Delhi had given, Islamabad is also insisting on tapes of recordings of the conversation of the Mumbai attackers and those of the conversations they had with their Pakistan-based handlers. Sources say this could be a complicated process as giving actual tapes that run into more than 60 hours may not be feasible. Besides, it may also compromise the source of interception.

Analysts question Islamabad's motives. If they are not capable of probing the assassination of their former prime minister Benazir Bhutto, how do you think they will hold a fair trial into the Mumbai attacks? These questions have been sent as part of a tactical shift by them, and I don't think anything will come out of it, says Ajit Doval, former director of the Intelligence Bureau.

Another glaring omission in Pakistan's response is that it avoids any mention of the role played by Pakistani state actors, including the ISI. For instance, in the transcript that India had provided to it there was a reference to a major general who issued instructions to the attackers, but Islamabad has maintained silence on his identity.

The Pakistani response is not without its fallout in Islamabad. Intelligence inputs suggest that there is a growing rift between Pakistani President Asif Ali Zardari and Prime Minister Syed Yousuf Raza Gilani over the Mumbai investigations.

While Gilani, under the influence of ISI and the army, wanted to soft-pedal the probe and delay it, Zardari has been pressing for a time-bound probe, partly under the US pressure and also because he realises that it was a similar cocktail of jihadi groups that killed his wife Benazir.

India realises that its diplomatic pressure has worked and that it has made Islamabad admit to its complicity, which has never happened in the past. So, in the coming days it will only mount more pressure. And the indications were there, during the week, when US special representative for Pakistan and Afghanistan Richard Holbrooke met External Affairs Minister Pranab Mukherjee.

The message was also conveyed to Washington that while India had noted that Pakistan had taken the first step, the international community had to ensure that Islamabad followed it with action against the Mumbai attackers and dismantled the terror infrastructure.

India will have to ensure that global heat is maintained on Pakistan so that the Mumbai investigations do not become just another tactical ploy by Islamabad to buy time and instead, some real and credible action is taken against the masterminds of 26/11.

PAKISTAN'S POSERS

30 queries on 26/11 and India's likely response.

Q1. What has Ajmal Kasab said in his confession before the court?
Response: Yet to give a statement

A colonel-rank official and a civilian — both with the Special Communication Organisation operating under Pakistan’s Ministry of Information and Technology — have been named for facilitating the Voice Over Internet Protocol (VoIP)-aided communication the 26/11 attackers had with their handlers in Pakistan. They are among the 35 wanted listed in the chargesheet filed by Mumbai Police.

The Mumbai Police Cyber Crime Cell tracked the two officials — Colonel R. Saadat Ullah and Khurram Shazad — during their search for Kharak Singh, the name used to open a VoIP account with Callphonex, a US-based service provider. The account was opened on October 21 and 22, 2008. On October 27, an initial payment of $250 was wired to the account via Moneygram. The moneygram agent, Paracha International Exchange, was traced to Lahore.

A second payment of $229 was made on November 25, a day before the attackers reached Mumbai, via Western Union Money Transfer agent Madina Trading, Brescia in Italy. The sender was one Javed Iqbal who’d provided his Pakistani passport for identification.

During investigation, it came to light that the communication with Callphonex was made using the e-mail ID [email protected]. The ID was accessed from at least 10 Internet Protocol addresses. It is from one of these that the cell traced the location of Saadat Ullah and Shazad.

Another supposed Pakistan army official was identified by the pseudonym Major General Sahab. Arrested Lashkar-e-Tayyeba operative Ajmal Amir Kasab and Indian LeT operatives Fahim Ansari and Sabahuddin Mohammad identified the Major as the one involved in training LeT cadre engaged in anti-India operations. JCP, Crime, Rakesh Maria said efforts were on to identify that official.

Furthermore, the chargesheet has ruled out the possibility of local or underworld connections to the attacks, as suspected by some quarters. It also clarifies that all the attackers were fidayeen and had no plans to return to Pakistan.

Though 12 different FIRs were registered in connection with the attacks, the police filed one consolidated chargesheet after clubbing all the offences. “All these offences are part and parcel of one broader conspiracy and, therefore, we have filed one consolidated chargesheet”, Special Public Prosecutor Ujwal Nikam said.

The chargesheet outlines in detail how LeT bosses across the border hatched a conspiracy, trained 32 cadre and selected 10 for the attacks, then retrained them. It talks about how the 10 reached Mumbai on November 26 after hijacking the fishing trawler Kuber and how they wreaked havoc across the city for the next three days.

More serving Pakistani army officers may be named as conspirators in the Mumbai terror attacks, according to officials dealing with the case, after an 11,509-page charge sheet identified two high-ranking Pakistani military personnel who directed militants during the three-day killing spree.

Police in India named Colonel R Sadatullah of the Pakistani army's Special Communications Organisation (SCO) as part of the conspiracy to attack India's financial centre – a bloody rampage that left more than 170 people dead. Investigators said his email account was used to set up the "voice over internet" system – which allows calls to be made over the web.

Today Indian television contacted Sadatullah after being given his number by the Pakistani army switchboard. He hung up. Another accused is known as "Major General Sahab", whose title is used repeatedly in the taped conversation between the gunmen and their handlers.

The general manager of the SCO is Major General Muhammad Khalid Rao, an expert on China who joined the corps in 1979. The SCO operates only on the Pakistani side of the Himalayan region of Kashmir – which is claimed by both Pakistan and India.

Brigadier Azmat Ali, Pakistan's army spokesperson, said the "charge sheet does not accurately identify army men allegedly linked to 26/11. There are many Colonel Sadatullahs in the Pakistan army."

Speaking on condition of anonymity, Indian officials said "it was not a good sign to see this kind of response from the Pakistani army … supplementary charge sheets will be added as the investigation progresses and might be many more [Pakistani army] names to add".

Experts said it was significant that the Pakistani army's telecommunications officers had become part of the investigation – pointing out that the militants were guided by phone calls from their handlers in Pakistan.

During the 58-hour siege of Mumbai, a total of 284 calls, running into 995 minutes, were made by the 10 gunmen using mobile phones from the Taj Mahal hotel, Oberoi-Trident and a Jewish centre – where hostages were taken and shot.

Mumbai police point the finger at 38 individuals, 35 of whom are yet to be apprehended. The three who are in police custody include the lone surviving Pakistani gunmen, Ajmal Amir Kasab, and two Indians, Faheem Ansari and Sabauddin Ansari. "The investigation is not over," said the officials.

The two Pakistani army officials are mentioned as accomplices of the Lashkar-e-Taiba, the Islamist militant group which India says was behind the attacks. The others charged include the group's founder Hafeez Muhammad Saeed and fellow members Zaki-ur Rehman Lakhvi, Zarar Shah and Abu Hamza.

The Pakistani government, which has a number of men in custody, says it will not allow its nationals to face trial in India.

Pakistani officers are also involved in many afghan attacks but US and UK have brushed it under the rug. Very few things get done without the knowledge of the pakistani army.

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yeah and its quite sad really but the US "needs" Pakistan to at least pretend to enforce strict regulations on its borders. Then again we have seen this shot to S*** when they literally gave their land away to the Taliban. I think Obama has a special plan for Pakistan-US relations once he gets the troop surge in Afghanistan going.

Pakistan's navy has contradicted the Zardari government by saying that there is no evidence that captured terrorist Qasab used sea route from Karachi to reach Mumbai.

"We have seen no evidence that confirms he went from Pakistan to Mumbai," Pakistan navy chief Admiral Noman Bashir told reporters in Karachi.

Bashir also blamed the Indian Navy and Coast Guard for failing to prevent the Mumbai 26/11 terror strikes.

Bashir's statement contradicts Pakistan interior ministry's statement that the sea route was used to carry out terror attacks in Mumbai.

Qasab and his associate Mohammed Ismail Khan had gunned down 59 commuters at CST on November 26 last year. He was caught by police at Girgaon Chowpatty while his associate Khan was killed during an exchange of fire.

PTI adds:

Pakistan navy chief's contention contradicts interior ministry chief Rehman Malik's admission two weeks back that the Mumbai attacks were "partly" plotted on Pakistan soil and launched from its shores for which it has arrested six persons.

"The evidence that I have doesn't show" that the terrorists went from this country. "This is India's claim from day one. Even before the Mumbai incidents had ended, India was saying that the terrorists have used sea route," he said.

The Navy chief wondered how the terrorists could have escaped the tight vigil of the Pakistan navy guarding its coastline.

"If they have evaded us and the Indian Navy which is ten times bigger than our navy and cheated them along with the Coast Guard, which is 12 times bigger than our coast guards, what shall I say," he said.

Bashir said they were lot of questions that still needed to be answered about the Mumbai terror attacks.

"I don't want to make anymore comments on this until I have seen some evidence and if Qasab and others reached Mumbai via our waters, the question is what was the Indian Naval and Maritime forces doing?

If this was true, it showed the failure of the Indian Navy and the Coast Guards, he said.

Till last week Mohammad Altaf was the man accused of plotting to kill Ajmal Qasab, the only terrorist caught in the Mumbai attack.

He was detained on the 14th and grilled for several days -- after his name figured in a RAW memo.

But, the premier intelligence agency was actually taken for a ride by two of its informers from Kashmir.

One of the informers -- Syed Muzaffar -- has been arrested. The other informer Shahbaz is still at large.

Mohammad Altaf says: "They told me that you have links with Ajmal Qasab and you are involved in Mumbai attacks. I said how. They showed me a letter pad of LeT and also a letter from Ministry of Home Affairs."

The RAW memo sent to all agencies on February 13 read:

"According to the intelligence, Abu Haider contactable on mobile NO 9906786052 has been directed to execute a fidayeen attack in Mumbai to eliminate the lone surviving terrorist of Mumbai terror strikes, Ajmal Kasab. Abu Haider has a group of 5 militants, who recently arrived (Dec 08, Jan 09) at his disposal for the plan."

Altaf, who runs a school in Srinagar, was passed off as a Lashkar-e-Toiba financier in contact with Abu Haider, a Pakistani national and a Lashkar commander.

But Abu Haider was found to be a common villager, Nisar Ahmad Mir from Bandipore. And Altaf's calls and activities revealed a clean record.

Finally, the police started investigating the RAW informers, and Muzaffar confessed.

He had nailed Altaf because he had sacked a teacher, who happened to be his relative.

Mohammad Altaf says: "He was harassing me, threatening me. He was saying that he is working with IB, DGP is his friend and working RR. He was also having a pistol with him. But I was not scared, at last I saw how they settle score with common people.''

The other RAW informer Shahbaz had also named one Akram Yatoo for his Lashkar links. But Yatoo's only crime was that he wanted back the Rs 1.5 lakh. he had loaned Shahbaz.

Mohammed Sadiq Ishrar Sheikh (31), co-founder of the Indian Mujahideen (IM), along with others, planted the bombs on the city’s trains (the bombings left 209 dead). He made this confession to the police on Friday. A copy of the confession is available with HT.

HT had first reported on October 14 that IM had executed the July 11, 2006 serial blasts. Also, on October 11, HT had reported on Sadiq’s journey into the world of terror — how he’d joined the Students’ Islamic Movement of India in 1996 after the Babri demolition and then the Lashkar-e-Tayyeba under the influence of his sister’s brother-in-law Salim Mujahid Islahi.

Islahi got Sadiq in touch with one Asif Raza Khan over email. After a year, Raza came to Mumbai and told Sadiq he’d have to undergo terror training in Kolkata for nine months. Sadiq agreed. He was given a telephone number to contact a particular person near a mosque in Kolkata. Sadiq told the police that person then sent him to Pakistan for training.

In 2003, Sadiq attended another training session that lasted for 45 days. During this trip, he met Riyaz Bhatkal in Dubai. Then, under Raza’s directions, Sadiq formed IM in 2005.

Aatif Ameen — who was recently gunned down in the Batla house encounter in Delhi — was operational commander of IM and helped Sadiq plant the bombs on the trains.

Sadiq is suspected of being involved in most of the blasts since 2005 though he has only confessed to the Mumbai train blasts. He also did not reveal if he and four of his accomplices posed as Pakistanis, or if the other accused arrested and chargesheeted by the Anti-Terrorism Squad were involved.

Sadiq told the police that planning for the train blasts started soon after the Varanasi railway station blasts. It was Aatif Ameen who initiated the planning, he stated.

NEW DELHI: Colonel R Sadatullah, who has been chargesheeted for arranging telephonic conversations between the Mumbai attackers and their Lashkar
bosses, has admitted that he works for Pakistan's Special Communication Organisation (SCO).
Sadatullah, whose role has been highlighted by TOI, also confirmed that he worked out of the SCO office on Qasim Road in Pakistan's garrison city of Rawalpindi.

While Sadatullah denied any complicity in 26/11 and even condemned it, his acknowledgement of the association undercuts Pakistan army's assertion that tracking the colonel chargesheeted for 26/11 would not be easy.

Pakistan army spokesperson Brig Ajmat Ali had on Thursday said that there were many Sadatullahs in Pakistan army, dodging the fact that the 26/11 chargesheet specifically referred to Col Sadatullah of SCO. Sadatullah said that he retired from army over two years ago, and was since working with the IT branch of SCO.

The charge against the colonel is that he provided the line that was used by Zarar Shah, one of the Lashkar seniors, to choreograph the massacre in Mumbai by giving instructions to the jihadi gang on how to carry out the mayhem.

SCO is no ordinary service provider. It was set up by the government of Pakistan to provide network in Pakistan-occupied Kashmir and Northern Areas. Pakistan army officers, both serving and retired, hold critical positions in the SCO, serving areas which are considered to be of strategic significance for Pakistan.

NEW DELHI (AFP) — India rejected Friday a claim by Pakistan's naval chief that the lone surviving alleged gunman in the Mumbai attacks did not enter India from Pakistani waters.

The naval chief Noman Bashir said that Pakistan had "no evidence whatsoever that (the gunman) Ajmal Kasab had gone to India from Pakistani territorial waters."

But Pakistan was engaging in "multiple speak, duplicity and denial" and had "created this confusion", India's junior foreign minister Anand Sharma told reporters in New Delhi.

India blamed the attacks, which killed 165 people last November, on the Pakistan-based militant group Lashkar-e-Taiba (LeT) and the siege soured a five-year peace process between nuclear-armed India and Pakistan.

Sharma said Pakistan had earlier acknowledged that Mohammed Ajmal Amir Iman -- also known as Kasab -- and nine other gunmen had arrived in India by sea and that Pakistan was speaking "in different voices".

Indian police have charged Pakistani national Kasab with murder and "waging war against India".

Kasab was the only alleged member of the 10-man Islamist commando-style unit captured alive during the November 26-29 siege.

Pakistani foreign office spokesman Abdul Basit said in Islamabad on Thursday investigators from the US Federal Bureau of Investigation (FBI) were due to visit Pakistan on March 4 to help probe the Mumbai attacks.

FBI director Robert Mueller will head the team, which Basit hoped would "assist Pakistani officials by providing further intelligence information".

Both LeT and Pakistan have denied any involvement in the attacks but the government in Islamabad admitted this month for the first time that the strikes were partly planned on its soil.

WASHINGTON: Cautioning that the 'hawala' money in India is directly linked to terrorist financing, the US has suggested to New Delhi to strengthen its anti money laundering and counter terrorism-finance legislations.

It also recommended that New Delhi should work towards becoming a full-fledged member of Financial Action Task Force (FATF), an inter-governmental body for development of policies to combat money laundering and terrorist financing.

While noting that the Indian Parliament passed the Prevention of Money Laundering (Amendment) Bill, early this week, a US State Department report has suggested that India should make necessary legislative amendments to bring its anti money laundering and counter terrorism finance regime in conformity to FATF.

"Given the number of terrorist attacks in India and the fact that in India hawala is directly linked to terrorist financing, India should prioritise cooperation with international initiatives that provide increased transparency in alternative remittance systems," said the report in its section on India related to money laundering.

The report, released by Assistant US Secretary of State for International Narcotics and Law Enforcement Affairs, David T Johnson, quoted RBI estimates that remittances to India sent through legal, formal channels in 2007-2008 amounted to USD 42.6 billion.

According to Indian observers, the report said funds transferred through the billion dollar hawala market are equal to between 30 to 40 per cent of the formal market.

"In that case the hawala market could amount to between USD 13 billion to USD 17 billion," the report on International Narcotics Control Strategy, said.

Given the large number of expatriates, India continues to retain its position as the leading recipient of remittances, according to the World Bank.

India's strict foreign-exchange laws and transaction reporting requirements, combined with banking industry's due diligence policy, makes it difficult for criminals to use formal channels to launder money, the report said.

However, large portions of illegal proceeds are often laundered through "hawala" or "hundi" networks or other informal money transfer systems.

The report appreciated the steps taken by India post 9/11 with regard to money laundering and its possible use by terrorist network. However, several key steps are still required to be taken by New Delhi.

Listing out the steps New Delhi still needs to take, the report said India should become a party to the UN Conventions against Transnational Organized Crime and Corruption.

"India should devote more law enforcement and customs resources to curb abuses in the diamond trade. It should also consider the establishment of a Trade Transparency Unit (TTU) that promotes trade transparency; in India, trade is the back door to underground financial systems," the report said.

The hawala system can provide the same remittance service as a bank with little or no documentation, at lower rates and with faster delivery, while providing anonymity and security for its customers, the report said.

According to the report, while most money laundering in India aims to facilitate widespread tax avoidance, criminal activity contributes substantially.

Some common sources of illegal proceeds in India are narcotics trafficking, illegal trade in endangered wildlife, trade in illegal gems (particularly diamonds), smuggling, trafficking in persons, corruption, and income tax evasion, it said.

nice propaganda article to justify aid being given to pakistan by USA? USA needs to take care of the failing banks,auto industry and the depression and job loss rather than dreaming of the Hawala system which they will never any knowledge of. total BS article. if anyone is financing terror it is USA and it always has been thru oil revenues going to KSA.